Question

Equivalent Units of Materials Cost

The Filling Department of Eve Cosmetics Company had 1,900 ounces in beginning work in process inventory (70% complete). During the period, 31,200 ounces were completed. The ending work in process inventory was 1,600 ounces (40% complete).

What are the total equivalent units for direct materials if materials are added at the beginning of the process?
units

Answer 1

Equivalent units using weighted average method = 32,800 units

.

Alternate answer-----Equivalent units using FIFO method= 30,900

Working

Statement of Equivalent Units(Weighted average)
				Material
	Units			Complete %	Equivalent units
Transferred out	31,200			100%	31,200
Ending WIP	1,600			100%	1,600
Total	32,800			Total	32,800

FIFO Working

STEP 1 (FIFO)
Reconciliation of Units
	Units	% already completed		% completed this period
		Material		Material
Beginning WIP	1,900	100%		0%
Units introduced	30,900
Total units to be accounted for	32,800
Completed and Transferred unit	31,200	0%		100%
Ending WIP	1,600	0%		100%

.

STEP 2 (FIFO)
Equivalent Units
	Total Units	Material
Units Transferred:		% completed this period	Equivalent Units
From WIP	1,900	0%	-
From units started/Introduced	29,300	100%	29,300
Total	31,200		29,300
	Total Units	Material
Ending WIP		% completed this period	Equivalent Units
Total	1,600	100%	1,600
Total EUP	32,800		30,900